Rupee cost averaging enables an investor to buy more units when markets are low and lesser units when markets are high.

a.

True

b.

False

2.

Rupee cost averaging:

a.

averages out the costs of your units and lessens the impact of market fluctuation on your investments.

b.

takes the lowest cost of units and lessens the impact of market fluctuation on your investments.

3.

In mutual funds, rupee cost averaging works in

a.

Systematic Investment Plans

b.

Dividend option

c.

All of the above

d.

None of the above

4.

You can take advantage of rupee cost averaging even if you invest a lump sum amount.

a.

True

b.

False

5.

Which of the following approaches will benefit from rupee cost averaging:

a.

Ravi invests ₹1,00,000 as a lumpsum into an asset class and forgets about it. He does not want to worry about what's happening to it on a daily basis as long as the investment earns him some returns in the long run.

b.

Ravi invests a fixed sum of ₹5000 each month. The fixed sum is invested regularly; he does not worry about when and how much to invest.